I just saw the new Blockbuster commercial for their “Total Access” rental program. As Alec Baldwin, the commercial’s narrator explains, it works just like Netflix with one “remarkable” difference. Instead of being forced to wait to get a new movie through the mail, you can simply stop by one of Blockbuster’s nearly 6,000 worldwide locations to return a movie and get a new one at no additional cost.
Bravo Blockbuster! I was starting to worry about you! Just when I thought your size and antiquated business model was going to be the end of you, you capitalize on your strengths, innovate, and introduce “Total Access”.
However, like Jim Collins describes in his book “Good to Great“, this groundbreaking strategy didn’t show up overnight. Since Netflix was founded in 1997, and upped the movie rental ante by heralding the death of late fees, Blockbuster has tried several different programs to stay competitive. It took them nearly 10 years to develop “Total Access”, which in my opinion, will make Reed Hastings (founder of Netflix) lose more than a little sleep.
But like the saying goes, “All good things come to those who wait.” In Blockbuster’s case, however, this doesn’t quite fit. I would say, “All good things come to those who wait, analyze, innovate, and implement,” and that’s exactly what they did.
I’m by no means a financial expert, but I have to believe that Blockbuster’s (BBI) stock price, which began its decline in 2003 as Netflix (NFLX) stock climbed, is no coincidence. But for over 3 years Blockbuster stayed the course, regardless of the pressure received from shareholders, and took the necessary time to develop a truly innovative solution.
Your move Netflix, check.
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